Pay-as-you-go IT: Where's the Business Value?

Home \| About Us \| News \| Contact Us \| New User Registration
	Research-based Market Strategy Consulting

Pay As you Go (PAYG) IT: Where's the Business Value?

Document:                        SSR-148
Date of Publication:           April 20, 2004
Number of Pages:             54
Lead Author(s):                 Mike West, Bruce Guptill, Bill McNee
Contributing Author(s):      M. Isaac, M. Koenig, B. Lett, J. Beresford, M. Driscoll (CFO)
Price:                               $995.00 USD

Report Overview:

Major multi-client study focusing on buyer trends, and key motivator and inhibitors concerning Pay-As-You-Go IT, a next-generation IT deployment and services model otherwise referred to as Utility Computing, Adaptive Enterprise or On Demand Computing. Study findings based on the results of a web and print/mail based survey with over 300 CFOs, CIOs and LOB executives, combined with detailed executive interviews. Co-published with research partner CFO Research Services.

Research Summary:

	PAYG IT is delivering real business benefits – although most implementations are limited to such traditional "back office" applications as benefits administration, travel and personnel management
	Financial and control issues dominate the decision to adopt PAYG. Capital expenditure reduction, operating cost reduction and ROI/Payback are the top PAYG motivators. Security, vendor dependency and availability/reliability concerns are the most-cited PAYG inhibitors. Put simply, the decision to implement PAYG adheres to the same basic decision factors as any other significant IT decision.
	PAYG as a mass phenomenon is moving rapidly beyond "early adoption" and accelerating toward the mainstream – but individual firms are taking small, careful steps. Nearly 20 percent of respondents indicated that they are currently using some form of PAYG services, which is exceptionally higher than anticipated. But the vast majority of these users are limiting their PAYG exposure to one or two back-office, process-focused, traditional applications as noted above.

In total, 310 senior executives were surveyed for "Pay-as-you-go IT Services: Where's the Business Value?" – 103 (33.2%) of which held senior financial titles such as Chief Financial Officer, VP Finance or Controller, 127 (41.0%) of which held senior IT executives such as Chief Information Officer, VP of IT or IT Director/Manager, and 80 (25.8%) of which held a variety of Line-of-Business (LOB) or senior operating executive titles such as Chief Operating Officer, Chief Marketing Officer, EVP, SVP, Managing Director and the like. The combined CFO, CIO and LOB surveys targeted both large and medium-sized enterprises in a cross-section of industries, with approximately 40% of respondents from companies with $1 Billion or more in annual revenue.

This independent research study was developed and executed by Saugatuck Technology from November 2003 through March 2004, in partnership with CFO Research Services, who are solely responsible for the analysis, conclusions and recommendations presented in this report. Funding for the publication of the research was provided by International Business Machines Corp. (IBM), Employease, Inc. and Perfect Commerce, Inc.

About Saugatuck Technology Saugatuck Technology provides IT-focused strategy and advisory services. The company uses a research-centric consulting model that combines business planning and market assessment with first-hand research research of executive buyer trends. Founded in 1999, Saugatuck is headquartered in Westport, CT (www.saugatech.com 1-203-454-3900).

About CFO Research Services Group Original research and thoughtful analyses are the cornerstones of CFO Research Services Group, the sponsored research arm of CFO magazine, which is published monthly in the United States and eight times annually in Europe and Asia. CFO Research Services' team of research professional dissects emerging trends in business and financial management using mailed surveys and personal, on-the-record interviews with respected financial executives. For more information, visit www.cfo-research.com.

To Purchase an Electronic Copy via Web Download:

Members who have purchased this report can access it by clicking here within 7 days of purchase.

Co-published by:

Home | About Us | Contact Us